Why China will drive global climate change deal

Green growth - an opportunity, not a liability

The global climate crisis is one of the most daunting crises precipitated by traditional economic growth. In Britain and the United States, industrialization took place a century or two ago when there was much less knowledge about the adverse affects of early capitalism, so few efforts were made to contain industrialization.

With its track record of rapid growth, China is one of the countries most affected by climate change. In the Global Climate Risk Index, an index that tracks which countries suffer most from extreme weather events based on the past two decades of recorded weather data, China and the United States are both ranked 26th worldwide, significantly behind India (17th) or Russia (23rd), but far ahead of South Africa (74th) and Brazil (78th). China's massive population translates into extraordinarily high death tolls and total economic losses, and the country's vast and diverse territory means that it suffers from a higher overall number of extreme weather events.

Neither China nor other large emerging economies have the luxury of replicating the experience of advanced countries that became rich first and cleaned up later.

China's new growth plan, which was developed in concert with the World Bank, supports the country's efforts to "grow green." Much will depend on how effectively government policies make firms internalize negative externalities and motivate firms to innovate and seek technological breakthroughs.

As China makes real gains in low-carbon development, the correlation between growth and carbon emissions will significantly weaken, and carbon emissions will peak. Such decoupling is already on the horizon, so it is likely that peak emissions in China will happen sometime in the 2020s.